Imagine that you’re the chief sustainability officer of a FORTUNE 500 company. During a meeting with your CEO, you say: “We need to talk to consumers about using less.”
Improbable? Sure.
Impossible? Perhaps not.
An important conversation to start? Absolutely.
So, at least, says Aron Cramer, the CEO of Business for Social Responsibility (BSR), a nonprofit association of companies, whose mission is to promote a just and sustainable world.
“The American model of consumption cannot be extended to the entire world, and won’t be, because the planet simply can’t support it,” Aron told me, when we spoke by phone the other day. Yet billions of people around the world want to improve their standard of living. Figuring out how they can enjoy a better life, without destroying the environment, “is the mother of all innovation challenges,” Aron says,
Last month, BSR published a 26-page report called The New Frontier in Sustainability: The Business Opportunity in Tackling Sustainable Consumption [PDF, free download). It’s an attempt to get business leaders to think about what sustainable consumption might look like.
The topic “has been the third rail of sustainability politics,” Aron told me, but he added, with his usual optimism, that “more companies are ready to have this discussion.”
If nothing else, the report makes clear the urgency of the issue. Citing a WWF report [PDF], it says:
By recent estimates, our global footprint now exceeds the world’s capacity to regenerate by about 30 percent, and if our current demands continue, by 2030 we will need the equivalent of two planets to maintain our lifestyles.
And yet:
…countless people have insufficient access to basic needs like food, clean water, and adequate shelter, and they also lack access to the resources they need to improve their lives. In 2006, the 1.2 billion people in the OECD countries had an average annual income per capita of US$30,580, while the 5.4 billion people in the rest of the world earned an average of US$3,130. Of those, 19 percent suffer from hunger, 28 percent are drinking polluted water, and 29 percent are illiterate.7 More than 2 billion people continue to rely on less than US$2 per day to meet their needs.
The question is, what business opportunities, if any, await companies that figure out how to give poor and middle class people what they want in a sustainable way?
The report points towards a few:
In fast growing emerging markets, it says, companies can create “different ways to improve well being” that enable “the leapfrogging of resource-intensive infrastructure in favor of light materials and digital services.”
Second, sustainable consumption also creates market opportunities for companies that use information technology to deliver positive outcomes for consumers.” Examples: Smart buildings, smart homes, a smart grid.
Third, companies have an opportunity to appeal to “the rising generation of consumers” who are “likelier to favor products whose sustainability attributes are clear.”
Finally, the report says, “embracing sustainable consumption provides a shield against price volatility and potential supply shortages of key commodities”
I asked Aron for examples of companies that are thinking, or even better, acting along these lines. Utility companies like PG&E and Southern California Edison are encouraging conservation and efficiency, he said. True enough, but they’re in a unique position—regulators in California have “decoupled” their profits from sales, so unlike most businesses, the power companies can make more by selling less.
Chevron, he noted, has an advertising campaign called “Will you join us?” that encourages conservation. “They’ve spent a lot of money to try to convince consumers to use less gasoline,” he said.
Other companies exploring what sustainable consumption might mean include eBay, which wants people to buy used stuff, rather than new, for obvious reasons, and Zipcar, which promotes car sharing. Best Buy sees an opportunity in helping its customers to be more efficient and save money. (See Why eBay is a Green Giant and Best Buy wants your electronic junk) Amazon’s Kindle and Apple’s iTunes dematerialize books and music. Other companies, meanwhile, are promoting reuse and recycling, or trying to transform products into services: Interface, Recycle Bank and Herman Miller, among others, come to mind.
But, IMHO, that doesn’t add up to much—not yet, anyway. Chevron’s conservation campaign is mostly marketing. Admirable as they are, EBay and Zipcar have unique business models. Cradle-to-cradle design is a niche, not a movement.
I hope Aron and BSR prove me wrong—really, I do—but I don’t think we should count on corporate America, or small business, for that matter, to drive sustainable consumption. Companies can help us consume smarter; clearly there’s a business opportunity in energy efficiency, and an even bigger one in renewable energy, particularly if governments tax or limit carbon emissions.
But consuming smarter goes only so far. We also have to consume less of just about everything, and that bumps up squarely against the business imperative, which is to sell more of just about everything, including a whole lots of crap that adds little or nothing of value to the world. If you doubt it, tour the nearest mall.
So who will lead the way? Religious leaders, we’d hope. Educators, from kindergarten through college. Parents, or more likely children. More to come on this in the next couple of weeks—including, when I take off on vacation next week, one guest blogpost from an eco-rabbi and another from a woman who hasn’t thrown anything into a landfill since 2006.
{ 10 comments… read them below or add one }
Marc – excellent post, and thanks for the attention to this important issue, and our work on it.
You are correct when you say that we can’t wait for business to make this vision a reality. My view, which we are infusing throughout BSR’s work on the subject, is that sustainable consumption will only gain traction if all key players – business, media, policymakers, and especially all of us as consumers – play a role and change our habits. In this way, sustainable consumption is really no different than other systemic challenges like climate change or human rights.
You have written widely about how we as consumers have to look in the mirror if we want a truly sustainable economy, and this is absolutely right. Our initiative is aiming to stoke supply from companies, and in doing so, stimulate demand from consumers. Only if both happen will we get where we need to go.
Great post!
Can’t agree more that ‘sustainable consumption’ – how to improve the quality of life for all without destroying the environment or over-harvesting the planet – should one of the most critical questions on the minds of global leaders: in business, in politics, and in civic life and society.
Incidentally, your pdf links for the BSR report as well as the WWF report are broken – here are the links that should work:
http://www.bsr.org/reports/BSR_New_Frontier_Sustainability.pdf
http://assets.panda.org/downloads/living_planet_report_2008.pdf
Marc,
Great article. Important topic. I’ve started to write about this myself, and will publish more soon.
I think, in the interest of furthering the debate, we all need to agree to some terms. Your implicit definition of “sustainable consumption” seems more analogous to “ecodesign or green design”
I prefer a definition closer to “responsible consumption” (think alcohol on New Years Eve.) Buy an (ecodeisgned) Energy Star light bulb and then make sure to turn it off when you leave the room. In other words, let’s make consumers responsible for, well, consuming the goods they buy responsibly. This applies to filling up the washtub with clothes before turning it on, and Levi’s “Care Tag” encouraging consumers to wash in cold water and line drying. (I’d like to think that “responsible consumption” also applies to responsible disposal, something else consumers should be responsible to do, but let’s leave that for another day.)
Not too many companies at this point have the courage or incentive to encourage consumers to consume less of their own products. In fact, I can point to only a few examples over my 20 plus years in the green business. Espirit, for one, ran an ad in 1990 saying “A Plea for Responsible Consumption: Please Don’t Buy More of Our Clothes than You Need”. As I reported in my book, Green Marketing, they say the phone rang with praise from consumers for years after.
But that doesn’t mean as a first step, we can’t encourage consumers to use less of “consummables” —Prius’s dashboard encouraging drivers to up the fuel efficiency (provided by their ecodesigned) car is another good example—, while continuing to develop the business models — the car sharing and E-bay used goods, etc. that make it profitable for businesses to encourage less sheer consumption.
I look forward to reading the two reports in this article and continuing the conversation. Thanks for getting it started.
I became aware of this controversy years ago while working for a mass market retailer where I headed the environmental program. It seemed to me to be an oxymoron, and it affected me personally somewhat because it put my personal values in conflict with my professional responsibilities. Perhaps less so in the home improvement business in which I worked, than selling a cheap tchotchke at Wal-Mart, because the basics of shelter are just that, the basics, and there was plenty of energy/water/health effect stuff to sell and focus on.
It seems to me the message is “less is more”. When President Carter said to use less energy and sat in front of the fire in his sweater, “his less is less” message did not go over well. Similarly, the “drill baby drill” message of the right that says “more is more” is out of touch. The “less is more” Gore/Obama approach sends the message that less is smarter. I think consumers are getting this message, but culture takes a long time to change. Now you’re getting the early adopters. No one thing changes culture; it’s a lot of little things, over an extended period of time, unless there’s a shocker type of thing, or a series of them. A lot of Priuses, or $4, the $8/gallon gasoline; a few terrorist threats, or the twin towers.
I always thought in terms of housing and McMansions/big hair housing, it starts with The White House, and if a US president were to say to make it a museum and build a new eco-white house, The Green House, with small living quarters, people would want that new model, not the big one. After all, you’ve got an immigrant here in Atlanta who build a 16,000 square foot true copy of the White House as his family residence, so setting aspirational examples is important.
On the other hand, you’ve got to have affluence to have sustainability, because the natural state of humanity is to want a better life. But affluence is no longer defined as more for more’s sake. Once you have affluence, you can afford to have less of the one thing that, despite our so far having proven Malthus wrong, still impacts the planet most, population. This is borne out when man transitions from a crude agricultural society to more sophisticated practices and gets better health care. It is proven time and time again when immigrants move to the US and have big families, then the next generation, more affluent, have smaller families. It will happen in an increasingly affluent China, and then the country’s one child per family law will most likely become unnecessary. It’s happened in the US as our official population growth is due to legal immigration.
Businesses that perfect the less is more formula in production and marketing of their products, providing products with more value that have less impact and cost less, will be the winners; eventually everyone will “get it”.
Marc, I would like to know more about the initiative in California, where the the power companies can make more by selling less. How does it work? In your opinion, can this initiave be used in another regions/countries?
Congratulations for the blog. I read all the posts.
Thanks, Marc. You’ve raised the issue I wrestle with most as a marketer focused on sustainability. If consumption is the engine of our economy, marketing is the fuel. So as a marketer, I can make the choice to fuel unsustainable consumption or sustainable consumption.
One way or another, humans have to consume to be healthy, safe and happy. Seems to me if there is such as thing as unsustainable consumption — and I certainly believe there is and we in the US are prime examples — there also has to be a state of sustainable consumption. In other words, the latter is not an oxymoron. In fact, our only choice if we want to continue as a species is to find that point of consumption that can be sustained planet-wide indefinitely into the future.
I believe inherent in the concept of sustainable consumption must be the imperatives for the affluent millions to consume far less, the impoverished billions to consume more to at least meet basic needs and everyone to consume smarter.
Clearly, a challenge like this requires all hands on deck. Business is just one of the players that must lead the way — and they can. It may be true, as you say, that “the business imperative…is to sell more of just about everything.” But if what we mean by “everything” becomes less and less about material- or resource-intensive things and more about experiential things (i.e., low environmental impact), business can satisfy humans’ desire to consume, while creating meaningful work, healthy communities and economies and fair shareholder return. Happily, many in business (including in my hometown of Portland, OR) understand this transition to sustainable consumption must be made and are helping to lead the way. They’re the good guys, and it’s up to marketers like me to fuel their success.
Thanks for all these terrific comments. Obviously this is a big, interesting issue that deserves more attention.
Just a few quick reactions..
Aron, I’m glad that BSR is taking this on and we agree that business can’t do it alone. My point is this is going to have to be driven by other leaders–either from NGOs (not likely, for reasons not worth explaining here) or clergy (my hope) or maybe teachers, parents, people with common sense, even scientists who help explain to the rest of us that more stuff does not equal more happiness.
Jacqui, good point re lifecycle assessments. I guess by sustainable consumption I do mean sustainable, cradle-to-cradle design. That’s one way we consumers can have our cake and eat it too.
Mark, I really like the idea of the “green house” but I fear it’s a ways away.I do think you’re right that businesses that can figure how to to sell “less is more” will have some real edges, That’s one point in the BSR report.
Rich, I’m glad that a marketer like you is wrestling with these issues. We need smart people to “sell” the idea of sustainable consumption. I hear great things about Portland and would love to get there and see what’s going on.
I’m with Rich; as marketers we understand how to motivate human behaviors. Our new challenge is to evangelize & enable more sustainable lifestyles – with prosperity, not growth, as the ultimate aim.
In a silver lining moment, the global recession gifts us the opportunity to move on this now; witness the growth in peoples’ awareness of dematerialization as a route to happiness e.g. Stephanie Rosenbloom’s excellent piece in the NYT : http://nyti.ms/cFQ0Ay
One ‘model’ of more sustainable consumption is proposed by Rachel Botsman in her upcoming book, ‘What’s Mine is Yours’. See http://www.collaborativeconsumption.com And she’s selling it brilliantly.
I’ve been wrestling with this topic since I read Tim Jackson’s “Prosperity without Growth.” I think Juliet Schor provided some interesting ideas in this post: http://www.thebrokeronline.eu/en/Online-discussions/Blogs/Global-green-economics/The-joys-of-making-and-doing-ISEE-2010
Hi Marc,
Really enjoyed your concise and timely post on Sustainable Consumption.
It would seem that fundamentally altering consumption patterns and moving humanity from “conspicuous consumption” to “conscientious consumption” will require that we link it to an ideology which reflects the evolutionary phase we are now in.
Social movements have thought us much in this regard. Take a look at this speech to Global Sustainability Summit and see if it resonates: http://bluniall.wordpress.com/2010/07/26/creating-a-sustainable-future/
Niall Dunne
Saatchi & Saatchi S
Managing Director for EMEA
80 Charlotte St, London W1A 1AQ
M: +447927179590
http://uk.linkedin.com/in/nialljdunne
http://twitter.com/bluNiall
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